ECN 331 · The Macroeconomics of International Trade
Course Description and Lecture Plan by Session:
Click here for the course description (kursbeskrivelse) Click here for the lecture plan (kursplan)
| Session / date | Description of Lecture Topic | Lecture Outline | Reading Assignment | Handouts |
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Module 1. Macroeconomic Mechanisms Supporting International Trade Flows |
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1 12.08 |
09.15 - 12.00 Introduction to course overview Section 1.1-1.7: Balance-of-payments accounts: macroeconomic analysis and international trade I |
Text: AFC, ch 19
SRP1: pages 1-15 |
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| 2 13.08 |
09.15 - 12.00 Section 2: Foreign exchange market: law of supply and demand and exchange rates; Section 3.1-3.5: Modeling currency markets; introduce partial equilibrium analysis in currency markets |
Outline 2 | Text: AFC, ch 20, 23
SRP1: pages 16-20 |
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14.08 |
09.15 - 12.00 Optional session to review partial equilibrium analysis for those students who require a "refresher"; groups work on class exercise (HW 1) |
Text: AFC, ch 14; RR; Houck, ch 15
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15.08 |
09.15 - 12.00 No formal lecture; work on class exercise; instructor is available for consultations |
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3 18.08 |
09.15 - 12.00 Present results of problem set 1 In-class exercise: Exercise 1 Section 3: Summarize and conclude partial equilibrium modeling of exchange rates |
Text: AFC, ch 22 SRP1: pages 21-22 |
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Module 2. Money, Goods and Asset Market Equilibrium |
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4 19.08 |
09.15 - 12.00 Section 4: Money markets and interest rate determination; Section 5: Interest rates, capital flows and exchange ratees (interest parity and investor behavior); evolution of capital markets, relationship between interest rates and exchange rates and the role of expectations for dynamic adjustment |
Text: AFC, ch 24-26; AFC, ch25 AFC, ch26 SRP2: pages 1-7 |
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| 5 20.08 |
09.15 -12.00 Section 6: Fiscal policy and goods market equilibrium; Section 7: Monetary policy and asset market equilibrium; development of the Mundell-Fleming model; Section 8: Effectiveness of fiscal and monetary policy under different exchange regimes; Section 9: Case study of budget and trade deficits and the value of the dollar | Outline 5 | Text: AFC, ch 24-26, 27-28
RR: K&O, ch 16; RR: K&O, ch 17; RR: K&O, ch 19 SRP2, p. 8-14 |
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| 21.08 | 09.15 - 12.00 No formal lecture; work on class exercise; instructor is available for consultations | Exercise 2 | ||
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Module 3. Alternative Exchange Regimes, Optimal Currency Areas and Monetary Union |
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| 6 22.08 |
09.15 - 12.00 Present
results of problem set 2
In-class exercise: Exercise 2 Section 10: Choosing from alternative exchange regimes |
Outline 6 | RR: K&O, ch
16; RR: K&O, ch
17; RR: K&O, ch 19 SRP3: pages 1-10 |
Exercise 3 |
| 7
25.08 |
09.15 - 12.00 Present
results of problem set 3
In-class exercise: Exercise 3 Section 11: Capital controls; Section 12: Economics of monetary union |
Outline 7 | Text: AFC, ch 29 (p. 743-47)
SRP3: pages 11-24 |
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| 8 26.08 |
09.15 - 12.00 Section 12: conclude monetary union; summarize and conclude course | Outline 8 | RR: K&O, ch 19; RR: FT-EMU; SRP3: pages 11-24 | |
| 9
29.08 |
09.15 - 11.00 Review session | Review questions | Exam Instructions; Exams 2003-04; Exams 2005-09 | |